Minimum wage exception bill stalls in House Finance

Posted: Friday, April 12, 2002

By CATHY BROWNAssociated Press Writer

JUNEAU (AP) -- A bill that would let remote seafood processors deduct room and board from workers' checks -- even if that drops their pay below minimum wage -- stalled Thursday in the House Finance Committee.

A 5-5 vote kept the bill from moving out of the committee. That was a setback for Rep. Pete Kott, R-Eagle River, who had scheduled the bill for House floor action Thursday.

But Kott said he will try again to move the measure next week when an absent committee member, Nome Democrat Richard Foster, returns to Juneau.

And Kott said he will try to change the minds of some who voted against the measure ''by explaining the bill a little more thoroughly behind closed doors.''

As chairman of the House Rules Committee, Kott has the ability to block other legislators' bills from going to the House floor, but he said he would not use that power to influence opponents of House Bill 504.

''That's not my personality,'' Kott said.

The bill allows processors to deduct $15 a day for meals and lodging, or more if the higher cost is reasonable and doesn't generate a profit for the employer.

Assuming workers log an eight-hour day, the $15 deduction would more than wipe out a proposed increase in the state minimum wage -- from $5.65 to $7.15 per hour -- for seafood workers.

State regulations already allow some seafood processors to deduct the cost of food and lodging for workers -- even if that puts them below minimum wage. But that's only allowed in communities where other room and board alternatives exist.

In remote areas and on nearshore processing ships, where workers have no choices, current state regulations do not allow employers to deduct room and board.

Supporters of the bill say processors need the break because they are struggling to stay afloat as they face increased costs and intense competition from the global farmed salmon industry.

Industry representatives have said the break will be particularly critical if the minimum wage increase passes the Legislature as expected.

''What we are doing with this bill is trying to fix an industry, what little industry we have,'' Finance Committee Co-chairman Bill Williams said.

Kathy Hansen of Southeast Alaska Fishermen's Alliance said if the bill doesn't pass, the processing plants will instead pass on the costs to fishermen by paying them lower prices for their catch.

Most commercial fishermen are probably earning less than minimum wage themselves, she said.

But opponents of the bill say the problems of the industry should not be solved by lowering take-home pay for low-wage workers.

''We believe this bill to be one of the most blatant instruments of oppression to come before the Legislature in a while,'' said Barbara Huff Tuckness, a lobbyist for Teamsters Local 959.

Rep. Jim Whitaker, R-Fairbanks, said the bill would deny a proposed increase in the minimum wage, which polls show Alaskans overwhelmingly support, to seafood workers.

''We agreed with the will of the people, and now through this bill, we've said, well, that's a qualified agreement,'' Whitaker said.

Rep. Bill Hudson, R-Juneau, pushed through an amendment to allow room and board to be deducted only for days when workers are paid for an eight-hour day. During slow periods in the fishing season, workers sometimes don't work a full day or at all.

The committee also narrowly agreed to an amendment by Davies to do away with an immediate effective date. Davies said applying the deduction right away would hurt workers before they've had the benefit of the expected increase in the minimum wage.